F.C. Bloxom Company v. Jason Laye

CourtCourt of Appeals for the Seventh Circuit
DecidedJuly 25, 2024
Docket23-1022
StatusPublished

This text of F.C. Bloxom Company v. Jason Laye (F.C. Bloxom Company v. Jason Laye) is published on Counsel Stack Legal Research, covering Court of Appeals for the Seventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
F.C. Bloxom Company v. Jason Laye, (7th Cir. 2024).

Opinion

In the

United States Court of Appeals For the Seventh Circuit

Nos. 22-3268 and 23-1022 F.C. BLOXOM COMPANY, Plaintiff-Appellant,

v.

TOM LANGE COMPANY INTERNATIONAL, INC., doing business as SEVEN SEAS FRUIT, Defendant-Appellee.

F.C. BLOXOM COMPANY, doing business as F.C. BLOXOM INTERNATIONAL, Petitioner-Appellant,

JASON LAYE, Respondent-Appellee. ____________________

Appeals from the United States District Court for the Central District of Illinois. Nos. 3:20-cv-3147 & 3:22-mc-03005 — Sue E. Myerscough, Judge. ___________________

ARGUED OCTOBER 30, 2023 — DECIDED JULY 25, 2024 ____________________ 2 Nos. 22-3268 & 23-1022

Before EASTERBROOK, RIPPLE, and SCUDDER, Circuit Judges. SCUDDER, Circuit Judge. This appeal presents a dispute under the Perishable Agricultural Commodities Act, a Depression-era statute that regulates the market for fresh fruits and vegetables. Seven Seas Fruit initiated administrative proceedings against F.C. Bloxom Company under the Act when Bloxom refused to pay for three loads of onions. The Secretary of Agriculture found for Seven Seas, and Bloxom exercised its statutory right to what the Act calls a “trial de novo” in federal district court. Agreeing with the findings of the Secretary, the district court entered summary judgment for Seven Seas. Bloxom challenges that ruling on appeal. Seeing no reversible error, we affirm. I A F.C. Bloxom Company is a Seattle-based distributor, im- porter, and exporter of fresh produce. The company does not itself grow fruits or vegetables but instead acquires them from suppliers for resale to customers in the domestic and interna- tional markets. In August 2018, Bloxom’s Brian Bernard received a call from a customer in Honduras seeking to import U.S. No. 1 grade onions. Bernard tapped his colleague Alejandro Her- nandez to help fill the order. Hernandez reached out to Seven Seas salesman Jason Laye to see if Seven Seas could supply the onions. Seven Seas agreed to do so, and the two sides ham- mered out a deal. Their agreement required Seven Seas to de- liver three loads of onions to the Port of Long Beach in Cali- fornia, for transport via an oceangoing container ship—the Nos. 22-3268 & 23-1022 3

MSC Channe—that was slated to set sail for Honduras on Au- gust 14. In the course of the parties’ negotiations, one item seemed to go overlooked. Honduras, like most countries, requires shipments of fruits and vegetables to undergo inspection for plant-borne pests and diseases before it will allow them to en- ter the country. These inspections must be conducted in the produce’s country of origin by a designated authority, most often a government agency. Only if that entity issues a so- called phytosanitary certificate declaring the inspected pro- duce safe for export will Honduran customs officials let it into the country. In Bloxom’s case, this meant that each load of on- ions had to be inspected by the U.S. Department of Agricul- ture before they left the Port of Long Beach. At no point during the contract negotiations did the par- ties expressly discuss the phytosanitary certificates. Bloxom’s Brian Bernard nonetheless came to believe that Seven Seas’ Jason Laye would procure the certificates. Laye not only had procured certificates for previous sales, but also, during the negotiations of this new transaction, offered vague assurances that that if Bernard secured space for the onions on the MSC Channe, he would “take care of the rest.” Bloxom claims to have had a second reason to believe that Laye would procure the certificates. It insists that it emailed purchase orders to Laye that explicitly stated that the certifi- cates would be “provided by Seven Seas.” The purchase or- ders further specified that Seven Seas would fax Bloxom cop- ies of those certificates “before” the onions were loaded onto the MSC Channe. 4 Nos. 22-3268 & 23-1022

But there was a gap, and that gap proved consequential. Seven Seas resolutely denied receiving these purchase orders or otherwise agreeing to procure the certificates. And at no point has Bloxom supplied concrete proof that they were sent. In the days following their negotiations, neither party arranged for a phytosanitary inspection, leaving the onions to arrive at the Port of Long Beach without the certificates necessary to clear Honduran customs. Even then, though, the Department of Agriculture could have performed an inspection at the port itself. But Bloxom believed that the phytosanitary certificates were in place, despite Seven Seas’ failure to fax copies as the purchase orders required. So, on August 13, Bloxom took no action as the onions were loaded onto the MSC Channe. They set sail for Honduras the next day—uninspected and indeed now uninspectable. Reality dawned slowly. It was not until the onions ap- proached Honduras that Bloxom began asking about the cer- tificates. On August 23, and again on August 27, Bernard asked Laye for a copy of “the phyto” for each load of onions. Laye responded that “[t]he shipper is FedEx directly to Hon- duras.” Bernard apparently took this to mean that the phyto- sanitary certificates had been procured by the company that grew the onions and that this third-party would FedEx them directly to Bloxom’s customer in Honduras. On this under- standing, Bernard asked Laye to “have them send [him] a copy via email.” No email followed. Pressure mounted once the onions arrived in Honduras. On September 1, Bernard informed Laye that Bloxom’s cus- tomer could not “get the containers of onions” out of the port because it “never got the phytos.” Bernard asked Laye whether he had “a scan” of the certificates that he could send Nos. 22-3268 & 23-1022 5

him and stressed that he “really need[ed] it ASAP.” Laye re- plied that he “emailed the shipper and requested” copies. On September 4, Bernard texted Laye that “[t]he Honduras cus- tomer [was] all over [him]” and pleaded with him to “work on the Phytos as soon as possible tomorrow morning.” That evening Laye informed Bernard of the worst possible news: no phytosanitary inspection had taken place. Now Bloxom had a major problem on its hands, for there was no way to obtain phytosanitary certificates in Honduras and, conse- quently, no way to deliver the onions to the buyer. To salvage the situation, Bloxom and Seven Seas began brainstorming alternative outlets for the onions. On Septem- ber 9, Bernard raised the possibility of selling them to custom- ers in Trinadad or the Dominican Republic. But these efforts did not pan out, and the onions remained in quarantine in Honduras. After much consternation, Bloxom had no choice but to ship the onions back to the United States. Jason Laye proposed shipping the onions to Jacksonville, Florida, where Seven Seas had contacts that might be willing to acquire them. Bloxom agreed to the proposal, and the on- ions took to sea a second time. The onions arrived in Jacksonville on December 18, 2018. But the return shipping company would not release the on- ions until freight charges totaling $21,135 were paid. For sev- eral weeks, Bloxom and Seven Seas could not agree on which company should bear those expenses. And as long as the fees went unpaid, the onions could not be inspected for quality, let alone resold. So the onions sat. Eventually Bloxom and Seven Seas resolved the disagree- ment. In a letter agreement, which Bloxom signed on 6 Nos. 22-3268 & 23-1022

February 5, 2019, Seven Seas agreed to pay the $21,135 ship- ping fee “on behalf of Bloxom Company … in order to facili- tate release of the Onions.” The parties also formalized the terms of the consignment arrangement they had worked out in principle before. Bloxom expressly agreed to release the on- ions to Seven Seas as Bloxom’s consignee.

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